I am going BR on the 23rd, spoke to my mortgage company today as i wanted to send the keys back on the 22nd. My wife and i are seperated and have both moved out the property and it is in negative equity by a large amount and we have a seperate home owner loan. My wife will be going BR but not for a few months.
The mortgage company said they will send out a form that both my wife and i will need to sign before sending the keys back. They said they are also sending out a form for the court to sign stated they are happy for us to send the keys back. This confused me as really it has nothing to do with the court if we decide to send the keys back and i can't see anyone at the court signing it.
Do i have to have sent the keys back for the house to be able to include the shortfall in my bankruptcy, or is it ok to wait until after the hearing like the mortgage company want me to?
Any help is appreciated, i am filling in my SOA tonight.
If you are handing back the keys the mortgage company will send you a voluntary repossession form. If it is a joint mortgage then both parties will need to sign the form. There is a 'shortfall' clause in the form. You need to make sure that you cross this section out before sending it back otherwise it could mean that you would still be liable for the shortfall.
I am not too sure about the mortgage company sending a form to the court. Normally they would only involve the court if they needed to repossess the property and evict you.
Just to be safe I would wait until you are declared BR with the mortgage detailed in your BR and then send the keys back.
There may be a problem for your wife if she is not declaring BR for a few months as any joint debts would revert to her. I am not sure if any shortfall would be her responsibility until she declares BR but someone else may be able to confirm this.
Sending keys back/shortfall HELP!
Posted - 16 June 2009 : 18:45:53
